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| Prison audit finds 'high potential for fraud' |
| By californiawatch.org - Matt Drange |
| Published: 07/21/2011 |
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The California Department of Corrections and Rehabilitation lacks adequate financial controls and repeatedly failed to recoup overpayments of salary and travel advances from its employees, an audit released yesterday by the state controller's office found. The report concluded that the department's effort to collect those overpayments was "grossly inadequate," and as a result of the deficiencies, there was "high potential for fraud and misappropriation of public funds." The review included records from the 2009-10 fiscal year. “This is the latest in a series of agency audits conducted by my staff that point to the waste and abuse of state funds due to the lack of attention to collecting overpayments," Controller John Chiang said in a statement. "Gov. Brown and I are working together to identify the causes of these problems and to protect public funds.” As of July 30, 2010, the corrections department had more than $6 million in outstanding salary and travel advances owed to the state, including $465,000 that was more than three years overdue, according to the audit. The report also found a discrepancy of more than $4 million between the department's own records and bank reconciliation documents. In addition, the department used its revolving fund – money that is not constrained by the fiscal year – to spend about $3.5 million more than was appropriated in the state budget. Other findings include a failure by the department to correctly authorize payments of more than $15,000, which under state accounting procedures require two signatures of approval, as well as numerous accounting errors in check payments. Read More. |
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